The Federal Trade Commission (FTC) has initiated an investigation into several major corporations regarding their use of customer data, algorithms, and artificial intelligence to customize pricing for individual consumers.
Eight companies from various sectors—including Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros—received requests from the FTC on Tuesday. The agency seeks to understand how these pricing practices affect privacy, competition, and consumer protection.
These companies utilize data tools, including AI, to implement what is often referred to as “surveillance pricing,” also known as “dynamic pricing.” This practice allows businesses to present different prices for the same products based on various customer attributes such as location, demographics, credit history, and online shopping behavior.
Many of the firms contacted by the FTC provide transaction, sales, and pricing services to some of the largest companies both in the U.S. and internationally. For instance, Task is responsible for transaction management for major hospitality brands including McDonald’s and Starbucks. Similarly, Revionics supplies retail price optimization software to global chains like Home Depot. Pros, claiming to provide AI-driven pricing solutions, lists clients such as Nestlé, HP, and United Airlines and is also a technology development partner for Microsoft.
The FTC aims to clarify the “opaque market” that utilizes customer categorization to set targeted pricing strategies. FTC Chair Lina Khan stated, “Firms that harvest Americans’ personal data can put people’s privacy at risk. Now firms could be exploiting this vast trove of personal information to charge people higher prices. Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing, and the FTC’s inquiry will shed light on this shadowy ecosystem of pricing middlemen.”
The FTC is seeking information in four main areas: the types of surveillance pricing products and services offered by each company, their data collection methods, customer and sales information, and the impact of these practices on the prices consumers ultimately pay.